FHA Loans in Memphis, TN: Requirements & Insider Tips
If a low down payment and flexible financing are at the top of your checklist for a mortgage, then an FHA loan in Memphis may be just what you need!
We offer FHA mortgage loans in Memphis, TN, and all of the surrounding areas including Fayette, Shelby & Tipton County, and also in Mississippi. Even if you are moving out of the area, no problem we have you covered because we are licensed in all 50 states.
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We could not be any happier to be working with Wendy and her team. Wendy is personably available by cell phone day or night, so friendly, knowledgable, and pushes the whole process forward. My last lender was so bad I assumed all others were as well, Wendy & Team have totally changed my view on that. 100% recommend.
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Heartfelt FHA Advice from Me to You
Here are a few things we think you should know:
- It’s Ok to talk to a mortgage lender BEFORE you pick a Realtor or go house shopping.
- You may still be able to get a loan from us, even if you’ve been turned down elsewhere
- There are lots of financing options, so don’t be afraid to pick up the phone and talk to us. A short phone conversation answers a lot of questions!
- You CAN get everything the online lenders promise from a local lender
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FHA Loan Basic Requirements
If you’re searching for the best mortgage deal out there, an FHA loan is worth adding to your list. This type of loan offers low down payments, flexible financing, and no income restrictions. Take a look at what an FHA loan is and see if it’s the best fit for you.
This specific type of loan offers several incentives to reduce the up-front expenses of buying a new house. In everyday terms, the FHA program was created to put families into homes without stretching their finances! What does that mean?
- Credit score of at least 580 = 3.5% down payment
- Credit score between 500 and 579 = 10% down payment
- MIP (Mortgage Insurance Premium) is required (usually about 1.75% of your loan amount)
- Debt-to-Income Ratio must be less than 43%
- New home purchase must be your primary residence
- You must have a steady job and income
- Money to cover closing costs (usually about 2-6% of the purchase price)
In order to allow these more flexible financing terms, borrowers are required to pay for mortgage insurance which protects the lender in the event the loan defaults. There is an up-front premium (typically 1.75%) paid at the time of closing, and an annual premium which is escrowed and paid monthly.
FHA loan math can get complicated quickly! So while it’s a great idea to pre-qualify online and see what the numbers are, it’s best to schedule a short follow up phone call to discuss your situation and get a firm estimate on the important numbers.
Benefits of an FHA Loan
The qualifications for an FHA loan may be appealing in and of themselves, and there are other perks you should consider while weighing your future mortgage options. FHA loans have certain securities that are not built into other loans:
- Backed by the Federal Housing Administration
- Insured by the FHA
- Low down payment options
- Low minimum credit score limits
- Do not have to be a first-time homeowner to qualify
- Can still qualify despite prior bankruptcies or financial hardships
- Closing costs may be rolled into the loan amount
In order to allow these more flexible financing terms, borrowers are required to pay for mortgage insurance which protects the lender in the event the loan defaults. There is an up-front premium (typically 1.75%) paid at the time of closing, and an annual premium which is escrowed and paid monthly.
FHA loan math can get complicated quickly! So while it’s a great idea to pre-qualify online and see what the numbers are, it’s best to schedule a short follow up phone call to discuss your situation and get a firm estimate on the important numbers.
Things to Know Before Requesting an FHA Loan
It’s common practice to speak with a lender before talking to a realtor or even looking at houses. Understanding the implications of choosing an FHA loan is extremely important, and you should take the time to learn the ins and outs.
- Your home must be appraised by an FHA-approved appraiser
- Your home must be your primary residence (cannot be an investment property or second home)
- You must occupy the property within 60 days of closing
- You must have the home inspected, and the inspection must report that your property meets minimum standards
Determining how an FHA loan will impact you can get complicated, so it’s best to talk to an expert. The Wendy Thompson Team can break down what an FHA loan could mean for you and your family without any gray areas.
Whether you’re looking to purchase or refinance, we have the experience to help. When it comes to selecting an FHA loan, or any type of mortgage, it’s important to understand both the amount you qualify for and what you can actually afford. It’s our job to help you understand your options before you commit. To ensure your loan process goes smoothly – with no surprises – we work with you to understand your obligations including the monthly payment and closings costs. As an online lender, The Wendy Thompson Team offers the same level of customer service and expertise as a local entity.
Reach out today to discuss FHA loan options for your potential new home.
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Areas We Serve
However, as a local, Memphis based company, our primary service areas include:
Shelby County
Arlington
Bartlett
Collierville
Eads
Germantown
Lakeland
Memphis
Millington
Gibson County
Dyer
Humboldt
Medina
Milan
Trenton
Yorkville
Fayette County
Oakland
Somerville
Madison County
Jackson
Haywood County
Brownsville
Decatur County
Decaturville
Parsons
Mississippi
Olive Branch
Southaven
Lexington County
Chesterfield
Lexington
Tipton County
Atoka
Brighton